REL: 0938 HRS Rakon Limited
FLLYR: RAK: Rakon FY2019 Results Announcement
Steady growth in core business drives improving results
High technology company Rakon Limited ('Rakon' or the 'Group') posted a net
profit after tax of $3.4m (FY18: $10.0m), and Underlying EBITDA of $13.3m
(FY18: $12.1m) for the year ended 31 March 2019. The Group's Underlying
EBITDA was in line with earlier guidance provided of between $12m to $14m.
The prior year's $10m net profit after tax included $8.8m of gains recognised
in relation to the sale of property in Argenteuil France. It also included
the dilution gain and sale of shares in Thinxtra Pty Limited.
Managing Director Brent Robinson said, when the one-off gains are excluded it
was pleasing to see the year on year growth in core net profit on the back of
stronger 4.5/5G telecommunications infrastructure demand and continuing
growth in the Defence segment.
"The roll-out of 5G continues to be our biggest opportunity and challenge.
Rakon is well positioned with a good share of business awarded by Tier 1
customers. The challenge for Rakon is to meet existing demand and continue to
bring to market new products which meet the higher specifications demanded by
"A key event during the year was the acquisition in May 2018 of the remaining
51% of our previous joint venture Rakon India Private Limited (previously
called 'Centum Rakon India Private Limited'). With Rakon now having full
decision-making control of India's low cost manufacturing operation, it was
pleasing to see India's positive contribution to the Group's full year
result," he said.
The current year showed higher operating costs with the inclusion of Rakon
India from May 2018 and one-off costs relating to integrating Rakon India
into the wider Group.
Net debt was $7.7m (FY18: was a net cash position of $7.4m). This movement
was due to the impact of higher working capital requirements to support
growing revenue, the acquisition of Rakon India, and the investment in
additional manufacturing capacity during the year.
The value of Rakon's investment in Thinxtra changed from $5.3m at March 2018
to $4.5m at March 2019. Thinxtra's impact on Rakon's net profit after tax for
the year is -$0.3m. Further explanation is provided in notes B4 d) of the
audited financial statements.
The Directors confirm that this FY2019 results announcement is based on
Chief Executive Officer & Managing Director
All amounts are in NZ$ unless otherwise indicated.
Refer to Note B1 of the FY2019 audited consolidated financial statements for
an explanation of how 'Non-GAAP Financial Information' is used, including a
definition of 'Underlying EBITDA' and reconciliation to NPAT.
Anand Rambhai (CFO)
09 571 9225
021 206 0985
Rakon is a global high technology company and a world leader in its field.
The company designs and manufactures advanced frequency control and timing
solutions. Its three core markets are Telecommunications, Global Positioning
and Space and Defence. Rakon products are found at the forefront of
communications where speed and reliability are paramount. The company's
products create extremely accurate electric signals which are used to
generate radio waves and synchronise time in the most demanding communication
applications. Rakon has six manufacturing plants, including two joint venture
plants, and has six research and development centres. Customer support
personnel are located in fifteen offices worldwide.
Rakon is proud of its New Zealand heritage; it was founded in Auckland in
1967. It is a public company listed on the New Zealand stock exchange, NZX,
ticker code RAK.
End CA:00334626 For:RAK Type:FLLYR Time:2019-05-16 09:38:46